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Ralph Lauren Is Winning Chinese Hearts

The Chinese market has seen growing investor and consumer demand and interest in foreign luxury brands, especially in recent years. In particular, a few specific brands have caught the attention of the Chinese more and, as a result, gained more prominence and profit. Some brands booming and increasing their success in China are Chanel and, especially, Ralph Lauren.

The Case Study: Ralph Lauren

The Ralph Lauren Corporation was founded in 1967 and is a U.S. company listed on the New York Stock Exchange active in apparel, and product distribution in four categories: clothing, home, accessories and fragrances. Over the years, it has expanded its reach to many foreign countries, and in recent years it has been achieving much success in China.

As reported by the brand, the revenue increased by 3% in constant currency to $1.6 billion in the fourth quarter which ended on March 30th, surpassing expectations. During the three months from the start of the year, sales were primarily influenced by the Asia Pacific region, showing a 7% increase in constant currency to $394 million, with China demonstrating growth in the low double digits. Asia also took the lead for the full fiscal year, with China experiencing a 25% increase in sales.

Ralph Lauren store
Ralph Lauren Store. Photo: GettyImages

Winning Strategies

One of the winning strategies used by the brand to increase its success in China and, consequently, its revenues related to the Asia Pacific region has been to leverage cultural and traditional celebrations like Chinese New Year to acquire more customers. Resorting to events and promotional campaigns related to holidays or culturally significant events in Chinese culture has proven repeatedly to be a key strategy for successful brands’ expansion into the Chinese market. Additionally, Ralph Lauren focused on enhancing the product portfolio and increasing the average selling prices.

Ralph Lauren Executive Chairman and Chief Creative Officer stated that: “We marry elegance and style in aspirational worlds — from our recent fashion show featuring elevated classics to the vibrant home line we showcased last month in Milan — our teams around the world are delivering our vision with passion and care

Ralph Lauren Style
The Quiet Luxury Style by Ralph Lauren

The Most in Vouge Style

Chinese fashion and luxury market is known for its intricate and nuanced landscape. Consumers have firm ideas about what they want, and luxury brands often need to understand better Chinese consumers’ tastes and interests along with their strict bond with culture and tradition.

As for Ralph Lauren, Chinese consumers seem particularly interested in the brand’s iconic garments. In a challenging luxury consumer market, Ralph Lauren Corp. has demonstrated strong performance, showcasing the enduring appeal of its classic designs. The Ralph Lauren brand has seen positive results in China, capitalizing on popular style trends such as clean fits, Old Money (The classic and sophisticated aesthetic of old money style embodies timeless elegance. It includes traditional wardrobe essentials such as a finely tailored blazer and a pristine white button-down shirt. Rather than opting for flashy logos or bold prints, this style emphasizes a subtle sense of luxury) , Maillard, and American retro aesthetics. This has led to significant online engagement, with the hashtag “Ralph Lauren” garnering nearly 482 million views on Xiaohongshu.

CEO Patrice Louvet spoke with great pride about their achievements in China. She stated: “What’s working there is the team is doing a great job connecting the brand with the local consumer, tapping into this whole Quiet Luxury moment. Our core products, our staples, our icons are really resonating, so think cable knit sweaters, think our Oxford shirts, Polo shirts, unconstructed jackets.

Ralph Lauren hit the jackpot

Quiet luxury is, thus, the most winning style in China. The term refers to the new trend characterized by garments of extreme value and quality, timeless aesthetics and produced by luxury brands. So classic high-luxury garments without too much stylistic exaggeration are the most popular.

Ralph Lauren, with its Oxford shirts, mesh polos, and cashmere sweaters, perfectly aligns with current fashion trends in China. Quiet luxury, old money (老钱风), and clean-fit aesthetics dominate Chinese social media. Xiaohongshu user Junjie’s Wool Circle @君洁的羊毛圈 writes: “Ralph Lauren is really a brand that embodies the ‘Old Money style’ vividly. The Ralph Lauren 2023 spring and summer series covers almost all American retro styles, which are naturally low-key yet high-end. Elegantly relaxed and exquisitely casual, the collection perfectly captures the tone of the Old Money style.

Ralph Lauren Models
Guo Jingjing on the left and Chinese actress Gao Yuanyuan on the right as Ralph Lauren models to promote its latest collection. Photo: Ralph Lauren on XiaoHongShu

During the current business climate, China has significantly increased its share to 7% of the company’s total revenue, up from 3% before the pandemic. It is anticipated that China will continue to drive growth for the company in the future.

Chanel and Hermés in China

What About Chanel

Ralph Lauren is not the only luxury brand with great success in China in the last few years. Chanel and Hermés are also gaining popularity and increasing their revenues on the Mainland.

On Tuesday, Chanel announced that revenues for 2023 increased by 16% to $19.7 billion at comparable rates, driven by double-digit growth across all categories. The luxury brand, led by creative director Virginie Viard, experienced a growth of 23% last year.

Despite concerns regarding Chinese luxury consumption as outbound travel resumes, Chanel intends to maintain its investment in the market. This will involve the opening of new stores in mainland China, following the addition of 47 net store openings globally last year.

What About Hermés

Hermés has seen a huge increase in interest and revenues in the last few years. Hermès has consistently demonstrated strong performance in the luxury goods sector by effectively managing its production and inventory. The company prioritizes customer retention over acquisition and leverages exclusivity and scarcity to navigate the impact of the global post-pandemic slowdown on high-end goods, distinguishing itself from its competitors.

What is different about Hermés is the high level of attention they give to their already faithful consumers instead of trying to garner new ones. Alex Dumas, CEO of the luxury brand, stated: “What is specific with Hermès compared to other players is that we invest a lot in client events and much less in press and media events. We do the opposite of what other players in the industry do. Our main communication channel is the client or customer event…We don’t have a lot of money and press to drive up our revenue, unlike others.

Hermés and Chanel
Hermés and Chanel also have seen an increase in interest in their brands. Photo: Hermés and “The Impression“.

Different Brands, Different Strategies

Each company adopts a strategy that aligns with its business objectives. Leveraging promotional campaigns associated with culturally significant events in China can be an effective strategy. Utilizing social media platforms to build a presence is also crucial for expanding brand visibility in the Chinese market. Additionally, prioritizing affectionate customers can lead to increased brand loyalty, higher revenues, and greater influence within the Chinese industry, as noted by the CEO of Hermés.

It is evident that luxury brands are focused on expanding their consumer base in the Asia Pacific region and are determined to move forward, especially as the Chinese market shows a strong preference for the timeless aesthetic of foreign luxury brands.

As Luvet, CEO of Ralph Lauren, said: “Looking ahead to fiscal 2025, we are staying on offence by continuing to invest in our brand, our portfolio of iconic core products, and our consumer-centric ecosystems in top cities globally.

The Dragon Boat Festival: How to Celebrate It by Long Advisory.

Long Advisory digital marketing agency in China

Long Advisory supports Western companies in China through digital marketing. In fact, our experience has led us to believe that today, the best and most convenient approach to making your brand well-known in China is through a digital approach. Furthermore, thanks to our know-how, we know how to make your brand known to potential Chinese consumers. With the effective coordination of Long Advisory, your company will see a new rise in the largest market in the world: China.

Long Advisory is a digital marketing agency specializing in developing digital marketing solutions tailored for the Chinese market. 

Interested in expanding your brand in China? Contact us for more info and details at info@longadvisory.eu

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